Green v. McCord

• Decision Date: 10 June 1920
• Docket Number: 5 Div. 734
• Citation: 85 So. 750,204 Ala. 356
• Parties: GREEN, Superintendent of Banks, v. McCORD.
• Court: Alabama Supreme Court

85 So. 750

204 Ala. 356

GREEN, Superintendent of Banks, v. McCORD.

5 Div. 734

Supreme Court of Alabama

June 10, 1920

Appeal from Circuit Court, Coosa County; S.L. Brewer, Judge.

Action by D.F. Green, as Superintendent of Banks, against Z.D McCord, on a promissory note. From rulings on the pleadings plaintiff took nonsuit with bill of exceptions, and appeals. Affirmed.

George A. Sorrell, of Alexander City, and Charles S. Bentley, of Bessemer, for appellant.

J.W Strother, of Dadeville, and John Darden, of Goodwater, for appellee.

THOMAS J.

Because of the ruling of the court sustaining demurrer to plaintiff's pleading, a nonsuit with bill of exceptions was taken. Paterson & Edey Lbr. Co. v. Bank of Mobile, 84 So. 721; Schillinger v. Wickersham, 75 So. 11; Berlin Mach. Works v. Ewart, 184 Ala 272, 279, 63 So. 567.

To an understanding of the ruling making necessary the nonsuit it should be said that the superintendent of banks, liquidating the Farmers' & Merchants' Bank, sued defendant for $5,000 on a promissory note due and payable on the 1st day of February, 1918. To this defendant replied that he was an accommodation party to the note, to give the Farmers' &amp Merchants' Bank credit, and on condition that one Lauderdale would become cashier of said bank, and that others would furnish certain sums of money to said bank to supply it with additional capital with which to continue business; that said Lauderdale remained cashier only a short while thereafter, withdrew his personal deposit; and that the said bank was compelled to liquidate. To which plaintiff replied that defendant was an accommodation party to the note, which was used "as an asset of said bank, by depositing it with the First National Bank of Birmingham, as collateral to a loan of the same date of the defendant's note, and on said date the Farmers' & Merchants' Bank did obtain $5,000 from the said First National Bank of Birmingham, which went into the said Farmers' & Merchants' Bank, and thereby enabling it to continue business until the date above set out, and plaintiff alleges that the defendant cannot now plead the facts as alleged in said plea as a defense to said note." And the defendant replied that--

"After the execution of said note by the defendant to the Farmers' & Merchants' Bank, the said bank deposited said note as collateral with the First National Bank of Birmingham, Ala., to secure a note of $5,000, executed by the said Farmers' & Merchants' Bank of Goodwater, to the said First National Bank of Birmingham, to secure a loan of money made by the said First National Bank of Birmingham, to the said Farmers' & Merchants' Bank; that on the ______ day of February, 1918, the said Farmers' & Merchants' Bank having failed to pay said $5,000 note to the First National Bank of Birmingham, having paid only $500 thereon, this defendant, being an indorser on said $5,000 note to said First National Bank of Birmingham, paid the remaining $4,500 due to the said First National Bank of Birmingham, Ala., and became the owner of the said $5,000 and the collateral by which it was secured, and that neither the bank nor any person has been injured or in any way damaged by the action of the defendant in executing said note to the Farmers' & Merchants' Bank of Goodwater."

The plaintiff sought to avoid the rejoinder of full payment by the accommodation party (defendant) to the First National Bank of Birmingham, the only party who had relied upon defendant's accommodation note, as follows:

"That while the said defendant paid to the First National Bank of Birmingham, Ala., the said sum of $4,500, and thereby was subrogated to the right of said bank to all security held by it, that one item of security held by said bank was the note here sued on, which was and is a valid and binding obligation on the defendant to the Farmers' & Merchants' Bank for the sum of $5,000, that the defendant only paid to the First National Bank the sum of $4,500, and thereby the said Farmers' & Merchants' Bank became indebted to the defendant in the said sum of $4,500, and that at said time and as a part of said transaction and as due on the note here sued on the defendant was due the sum of $5,000 on the same, and plaintiff alleges that the debt so due by the defendant on said note operated to discharge and settle and satisfy the defendant in the

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